During a 40-minute speech in Abu Dhabi yesterday, Ben Bernanke earned more money than he did last year leading the Fed, according to a report from Reuters. His talk at a conference sponsored by the National Bank of Abu Dhabi earned him “at least” $250,000, compared to his 2013 salary of $199,700. If his speaking engagements continue at this pace, which experts say is likely, Bernanke could quickly out-earn his salary for his entire eight-year stint at the Fed.
The move to the speaking circuit has a long and lucrative tradition among former chairman.
“I found that I could give a speech or two and I could earn what I had made at the Fed,” former Fed chief Paul Volcker told the New York Times (paywall). Volcker’s salary was $80,000 a year.
Bernanke’s salary was by no means low compared to the average worker in the United States. But he earned less than a member of Australia’s parliament. And he took home less than half the salary of European Central Bank Chief Mario Draghi, who made $518,264 last year. (The ECB’s Vice President and executive board members out-earned Bernanke as well.)
At the top, the private sector has always out-earned the public, but the gap is increasingly stark. Overall, CEO pay in the US rose by as much as 800% over the past 30 years, according to The Economic Policy Institute. It found that the average US CEO made $14.1 million in 2012.
Bernanke, now at the Brookings Institution, didn’t leave the Fed because of his paycheck, but these fees are incentives for many. Other options like board seats and high-paying jobs from companies looking for government access create a revolving door, particularly to lobbyists and financial firms.
Anyone who knows how difficult a job Bernanke had or saw his marathon testimony sessions in front of congressional committees won’t begrudge him these paychecks. But the fact that it took him less than an hour to earn more than an entire year as arguably the single most powerful person in the global economy makes it pretty clear he was underpaid in the first place.